Reminder: Today is the deadline for selling to take tax losses in 2020
Sell today if you’re looking to sell to generate tax losses for 2020. After today, December 29, you can still sell but the losses will count for the 2021 tax year.
Volatility
Sangamo was up 52.98% Thursday–exactly why?
Shares of gene therapy player Sangamo Therapeutics (SGMO) soared 52.98% in the regular session today, December 10, and tacked on another 3.77% in after-hours trading. I always try to understand a huge one-day move like that–and frankly I frequently fail. Here’s my take on Sangamo’s big move on Thursday.
Closing all of my Options hedges in the Volatility Portfolio; holding off until January or February to add new downside protection
Stock have moved up so strongly that the Put Options I own in my Volatility Portfolio are no longer providing any significant downside protection against a market downturn. Especially since two of the three–the Puts on MGM Resorts International, and Vale l expire on December 18. The last Put, the one on American Airlines, expires on January 15, 2021, but I’m closing that position as well. I’m also selling my two Call Options on Barrick Gold, and the VanEck Vectors Gold Miners ETF since they also expire on December 18 and they are also so far out of the money the holding is pointless. Those Calls on gold were also added as protection against an outbreak in market volatility that never arrived.
Can’t swim against the cash flood anymore–selling my ProShares Short Russell 2000 ETF out of the Volatility Portfolio tomorrow
I bought the ProShares Short Russell 2000 ETF (RWM) back on October 30 because I felt then that the market wasn’t pricing in any of the potential problems likely to hurt the U.S. economy over the next couple of months. I picked the small cap Russell 2000 index for my downside bet because it was showing the most sensitivity to news–good and bad about the economy. Well, I got the sensitivity part right. But I missed the effect of huge cash inflows on stocks in general and the Russell in particular. Right now potential bad news and even actual bad news doesn’t matter much. Stocks keep going up. At the close on December 9, Wednesday, I had a 19.89% loss in this position after today’s slight 0.69% drop in the Russell 2000 (and 0.72% gain in this short ETF.) I’m not willing to let this loss get any bigger so I’m selling this position.
Taking my 200% gain in Kensington/QuantumScape today and selling this position
Shares of what was once Kensington Capital Acquisition (KCAC) and is now QuantumScape (QS) are up 203.3.7% since I bought Kensington back on October 13, 2020 in my Volatility Portfolio. But Quantumscape isn’t planning to have its solid state lithium ion battery in production until 2024. And most investors don’t understand the wave of dilution that’s about to hit the now public shares of QuantumScape. So I’ll be taking my profits tomorrow.
Cast your vote today for the Kensington merger
If you bought shares of Kensington Capital Acquisition (KCAC) along with me on October 13, you’re received a solicitation for a proxy vote to approve the reverse merger of Kensington with privately held QuantumScape, a startup solid state lithium battery company. The merger wis a way for Quantumscape to go public. (Kensington was the 14th and last pick in my Special Report: 10 Stocks for the Post-Coronavirus economy. Kensington has called a special meeting for shareholders for November 25 to approve the merger. You can vote online to 11:59 p.m. tonight. I plan to vote in favor of the merger, since that’s the whole reason for owning shares of Kensington.
Hey Wall Street! This isn’t your father’s gridlocked government
With Democrat Joe Biden seeming to be on the road to a victory in the Presidential vote and with Republicans remaining in charge of the Senate (unless Democrats can sweep two run-off votes in Georgia in January--unlikely, in my opinion) and with Democrats retaining...
Watch your Puts as a source of cash in any dip: My Puts on Vale and American Airlines move into black
Intended as insurance against a big market drop, my Puts on American Airlines (AAL) and Vale (VALE) have moved into the black in the last two days. My Puts on MGM Resorts International (MGM) could follow--the stock dropped 5.55% in after-hours trading yesterday on a...
Buying ETF to short Russell 2000 (and U.S. economic growth) tomorrow to add more downside protection
Yesterday, October 28, I posted that I would put off buying more downside protection against volatility in this nervous market for one more day. The plunge in stocks on Wednesday made downside protection more expensive--fear increases the demand for downside...
Market overlooks GDP headlines today–mostly
As of the close today, October 29, the Standard & Poor's 500 was up "just" 1.17%. (The NASDAQ Composite had gained 1.64% and the Dow Jones Industrial Average had picked up 0.52%) I say "just" because after yesterday's 3.53% drop in the index that move today is a...
No bounce after yesterday’s selling
What I like to see--if I'm on the long side of stocks--after a drop like yesterday when the Standard & Poor's fell 1.86% for its biggest loss in a month and the Dow Jones Industrial Average gave up 2.29%--is a bounce that speaks to investors and traders thinking...
Autoliv beats on prospects for global auto recovery–but I think you’ve got better stocks to play this trend
Autoliv (ALV) reported third quarter earnings per share of either $1.48 (non-GAAP) or $1.12 (GAAP). (GAAP is generally accepted accounting principles.) That consensus was $1.09 a share on Wall Street. Revenue of $2.04 billion was in line with expectations and up 0.5%...Jim’s Stock Alerts
Dip-O-Meter
